Special districts fear annexation will hurt clients

Two special taxing districts bordering Hood River are fearful that a city move to annex their territories will leave their clients underserved.

Both Ice Fountain Water District and West Side Fire District are opposed to the Hood River City Council's decision on Monday to annex about 475 acres. Those properties lie within the unincorporated western and south/central urban growth areas which are all currently served by city sewer and some residences also with city water.

Don Chandler, manager of Ice Fountain manager, and Jim Trammell, West Side fire marshal, believe the city is making the move toward annexation solely to bring in about $200,000 more each year in property tax revenue. Unfortunately, they say the city's gain stands to hurt both their agencies and the property owners, who will have their taxes increased an average of $300 per year.

"I believe it (city) is looking for a way to get more money and it stands to reason that in this economy everyone is looking for a way to survive -- but so are the taxpayers," said Trammell.

However, Lynn Guenther, city manager, said the annexation was intended to equalize the delivery of services since property holders throughout the city were currently bearing the cost for provision of services to the non-taxed urban growth areas. He said by incorporating the "urban fringe" the city could enact uniform design guidelines that would foster better planning for future growth.

Ice Fountain, which serves 1,700 clients, may be protected from budget cuts brought by the pending annexation since Guenther said officials have made no plans to take over its operations. However, Chandler said there is no finalized agreement in place at this time between the two parties that will guarantee that protection.

"This is still a thing in the works that we need to agree upon," Chandler said.

He said negotiations between the two public agencies are set to begin on Jan. 29 but he believes the city will ultimately work toward a resolution since it would be facing a "substantial" cost to legally buy out the infrastructure, pay off a percentage of the bond indebtedness, and reimburse lost income. Chandler said Ice Fountain would like the final agreement to allow an "opt-out" in the future after a long-term notice was given.

The city council also directed staffers and attorney Alexandra Sosnkowski on Jan. 14 to enter into negotiations with West Side for a withdrawal of its services. Trammell said that move would cost the fire district, primarily made up of volunteers, almost 25 percent of its $201,000 operating budget, an annual loss of about $53,000.

"We rely on our tax base to support the entire district and even though we lose a small portion of our coverage area our overall costs stay the same -- we still have to pay the same insurance premiums and buy the same amount of equipment," he said.

Trammell said in all fairness the city should follow Oregon law which allows it to enter into a "phase-in" agreement. He said that plan would provide Westside with long-term compensation or up to 10 years to turn over the reins -- both of which would allow it time for a financial adjustment.

The Hood River City Planning Commission will take public testimony about the proposed annexation at 7 p.m. on Jan. 30 in the old municipal building, 211 Second Street. The recommendation of that quasi-judicial body will be forwarded to the City Council for final consideration at 6 p.m. on Feb. 11 in the same location.